Contracting News

MDSI acquires ANAE
MDSI (Lawrenceville, GA), publishers of The Journal of Healthcare Contracting, The MAX, Repertoire and the Dail-E News, announced it has acquired the Association of National Account Executives (ANAE). With the acquisition, MDSI plans to create a high-value, membership-driven organization focused on professional development for corporate and national accounts executives calling on group purchasing coalitions (GPOs), regional purchasing coalitions (RPCs), accountable care organizations (ACOs), integrated delivery networks (IDNs), individual hospitals, national and regional distribution companies and managed care organizations. Further details for membership opportunities will be announced at a later date.

Bovie Medical releases Smoke Shark™ II Smoke Evacuator (SE02)
Bovie Medical Corporation announced the release of its improved Smoke Shark™ II Smoke Evacuator (SE02). The new unit incorporates a sleek, light-weight and compact design with simplified and flexible features, for evacuation and filtration of smoke plume during electrosurgical and laser procedures. For improved efficiency, the SE02 unit is packaged with a new ultra-quiet extended-life 35-Hour Filter (SF35). The filter is designed to accommodate three tubing sizes including; 7/8” tube, 3/8” tube and 1/4” tube providing versatility in procedure and accessory setup. The filter offers up to 35 hours of performance reducing procedure cost by 38%(+/-) from the previous model, when used at the lowest setting. The Smoke Shark™ II Smoke Evacuator is engineered with three flow setting (Low, Medium & High), and is integrated with smart technology which gauges the flow setting and automatically adjusts the filter life. To increase user and patient safety, the SF35 filter is now enclosed within the smoke evacuator unit.

Letter to the Editor
How should product innovation be evaluated?

John Pritchard’s Publisher’s Letter (“Welcome to 2013 and the era of reform”) in the February edition raises several questions about how hospitals will make decisions about product innovation, value and the price we are willing to pay for this advancement:

Will we pay more for such products, or will it be business as usual?

How will hospitals and physicians respond as reimbursements increasingly become linked to improved patient outcomes?

How will we determine the value of product innovation and the price point we are willing to pay?

Is there still truth in W. Edward Deming’s belief that quality costs less, not more?

Finally, how do we begin thinking on a level to make the right choice for our patients?

To successfully navigate the evolving system, we need to think systematically. System theory requires us to look at questions in relation to the whole, as opposed to a fragment or an episode. The value of innovation cannot be answered by price alone and certainly cannot be determined separately from its relationship to patient outcome. The value of product innovation must be measured against the full cycle of care. It begins with our “value assessment” and how sensitive our process is in measuring innovation relative to our hospital environment. It also is dependent on the ability of the manufacturer to provide objective clinical evidence in support of innovation. This will take special focus on how we define the function of each product and its clinical contribution.

At Christiana Care Health System, for example, we define product function by factors of outcome, safety, and quality improvements. This function is then compared against cost. If the product demonstrates that it improves the larger clinical cycle of care relative to what currently exists, there is value in paying more. The amount extra that we are willing to shell out depends on the relationship between my current product and the value of the new product’s contribution to improved patient care. The answer we find will determine whether we change to the new product.

Manufacturers will need to provide evidence to support the appropriate review of value so that we can measure the true effect at our health system. In our new world, a partnership must exist between the providers and the manufacturers to improve value that we provide to our patients.